UK - Trade union giant GMB is urging the government to introduce compulsory employer and employee contributions in the Pensions Bill.
The union says compulsion is the only way to secure “decent” benefits in retirement.
General secretary Kevin Curran – speaking at an Institute of Employment Rights conference, which saw the publication of Pension Promises and Employment Rights – said the voluntary approach “simply hasn’t worked”.
Curran said: “There is no point in the government forcing companies to offer a stakeholder pension scheme as the minimum if they are not forced to contribute to it. All this does in reality is offer employees a personal pension which they could quite easily have arranged for themselves.”
Curran said in order to have a “realistic chance” of providing a sustainable level of benefits on retirement, employers should pay contributions of 10% a year while staff paid 5% a year.
“There should be a ratio of at least two-to-one,” he said.
But the department for work and pensions defended the voluntary approach. A spokesman said: “For the voluntary system to work all partners have to play their part: government, employers, trade unions and individuals.”
He added: “We would prefer voluntarism to work, but in terms of compulsion the door is open. On the basis of the Pensions Commission assessment we will decide whether there is a case for moving beyond the current voluntary approach.”
Life expectancy in the UK saw no improvement between 2015 and 2017 as the number of people aged over 90 hit a record high, latest Office for National Statistics (ONS) data reveals.
Self-administered pension funds spent £14bn on payments to pensioners in Q2 2018, but only received £11.4bn of contributions (net of refunds), latest Office for National Statistics (ONS) data reveals.
The Pensions and Lifetime Savings Association (PLSA) has named the 17 members of its inaugural policy board after a competitive application process with 60 candidates.